Netflix (NFLX) Erases Half-Price Fear... 'Uptick' on Influx of Bargain Buying

▲ Netflix (NFLX)/AI generated image

A diagnosis has emerged that Netflix (NFLX) stock price has largely priced in negative factors. With an influx of bargain-hunting sentiment, it showed a rebound in pre-market trading.

According to U.S. financial media outlet Benzinga on September 22 (local time), Netflix shares traded at around $73.8 in pre-market before the New York stock exchange opened, up 2.8%. Mark Mahaney, Senior Analyst at Evercore ISI, noted that "a tremendous amount of bad news is already priced into Netflix shares" and highlighted its long-term growth trajectory. Evercore ISI maintained its Outperform rating for Netflix. The price target was also raised from the previous $100 to $110.

Mahaney evaluated that Netflix's ongoing new business strategies would lead to a performance rebound. Key catalysts included expanding live sports broadcasting rights, monetizing ad-supported subscription plans, and introducing short-form micro-dramas. Wall Street analysts' consensus rating was confirmed as 'Buy'. The average price target was $90.05.

Conversely, pessimism warning of intensifying competition and slowing viewing hours remains strong. Steven Cahall, an analyst at Wells Fargo (WFC), downgraded Netflix's rating to Underweight on September 18. The price target was also significantly cut from the original $80 to $57. Cahall pointed to a decrease in adjusted viewership in the first half and a lack of success for original content in the second half. He analyzed that margin pressure and subscriber churn risk could increase until 2027.

Technical indicators on the chart show mixed signals. While the stock price is below the 200-day simple moving average ($85.67), the $71 level is acting as a strong downside support. Whether the $71 support level holds and whether the $82.5 resistance level is broken will be a turning point for short-term stock price movements.

[Article Key Summary]

-Evercore ISI upgraded Netflix (NFLX) price target to $110, stating that negative factors have been sufficiently priced in.

-Optimism that live sports and ad-supported plans would drive a rebound was met with Wells Fargo's (WFC) warning of a downgrade to $57.

-As the stock attempted a pre-market rebound after finding support at the $71 level, attention focused on whether it would break the $82.5 resistance level.

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